Required: 1. Calculate Topanga's cost of goods sold for the first quarter using: a. FIFO b. LIFO c. Average cost 2. Calculate Topanga's gross profit ratio for the first quarter using FIFO, LIFO, and Average cost. 3. Comment on the relative effect of each of the three inventory methods on the gross profit ratio. Complete this question by entering your answers in the tabs below. Req 1A Req 1B Req 1C Req 2 Req 3 Calculate Topanga's cost of goods sold for the first quarter using FIFO. Cost of Goods Available for Sale Cost of Goods Sold - Periodic FIFO Ending Inventory - Periodic FIFO FIFO: of units unit Cost of Goods Number Cost per Available for Number of units Cost per unit Cost of Goods Sold Number of units in Sale sold ending Cost per unit Ending Inventory inventory Beginning Inventory 0 $ 0.00 $ 0 0 $ 0.00 $ 0 Purchases: January 7 8,000 $5.00 40,000 February 16 24,000 $6.00 144,000 8,000 $ 24,000 $ 5.00 40,000 0 $ 5.00 0 6.00 144,000 0 $ 6.00 0 March 22 28,000 $7.00 196,000 1,000 $ 7.00 7,000 $ 7.00 0 Total 60,000 $ 380,000 33,000 $ 191,000 0 $ 0
Required: 1. Calculate Topanga's cost of goods sold for the first quarter using: a. FIFO b. LIFO c. Average cost 2. Calculate Topanga's gross profit ratio for the first quarter using FIFO, LIFO, and Average cost. 3. Comment on the relative effect of each of the three inventory methods on the gross profit ratio. Complete this question by entering your answers in the tabs below. Req 1A Req 1B Req 1C Req 2 Req 3 Calculate Topanga's cost of goods sold for the first quarter using FIFO. Cost of Goods Available for Sale Cost of Goods Sold - Periodic FIFO Ending Inventory - Periodic FIFO FIFO: of units unit Cost of Goods Number Cost per Available for Number of units Cost per unit Cost of Goods Sold Number of units in Sale sold ending Cost per unit Ending Inventory inventory Beginning Inventory 0 $ 0.00 $ 0 0 $ 0.00 $ 0 Purchases: January 7 8,000 $5.00 40,000 February 16 24,000 $6.00 144,000 8,000 $ 24,000 $ 5.00 40,000 0 $ 5.00 0 6.00 144,000 0 $ 6.00 0 March 22 28,000 $7.00 196,000 1,000 $ 7.00 7,000 $ 7.00 0 Total 60,000 $ 380,000 33,000 $ 191,000 0 $ 0
Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Don R. Hansen, Maryanne M. Mowen
Chapter20: Inventory Management: Economic Order Quantity, Jit, And The Theory Of Constraints
Section: Chapter Questions
Problem 2CE: Sterling Corporation has an EOQ of 5,000 units. The company uses an average of 500 units per day. An...
Related questions
Question
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 4 steps with 2 images
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Cornerstones of Cost Management (Cornerstones Ser…
Accounting
ISBN:
9781305970663
Author:
Don R. Hansen, Maryanne M. Mowen
Publisher:
Cengage Learning
Principles of Accounting Volume 1
Accounting
ISBN:
9781947172685
Author:
OpenStax
Publisher:
OpenStax College
Managerial Accounting
Accounting
ISBN:
9781337912020
Author:
Carl Warren, Ph.d. Cma William B. Tayler
Publisher:
South-Western College Pub
Cornerstones of Cost Management (Cornerstones Ser…
Accounting
ISBN:
9781305970663
Author:
Don R. Hansen, Maryanne M. Mowen
Publisher:
Cengage Learning
Principles of Accounting Volume 1
Accounting
ISBN:
9781947172685
Author:
OpenStax
Publisher:
OpenStax College
Managerial Accounting
Accounting
ISBN:
9781337912020
Author:
Carl Warren, Ph.d. Cma William B. Tayler
Publisher:
South-Western College Pub